"In view of the protracted recession, we must do whatever it takes to overcome the unemployment crisis in Europe"
- EU Economic and Monetary Affairs Commissioner Olli Rehn
The 17-nation economy is now expected to shrink more than previously estimated this year, as latest data is adding to concerns that the economy is far away from the recovery, the European Commission said Friday. The region's gross domestic product will now fall 0.4% in 2013, compared with a February prediction of a 0.3% contraction. The Eurozone economy shrank 0.6% in the previous year and the forecast is now showing the region is heading for its first ever back-to-back years of falling output. The economic expectations underline a shift of focus in the Eurozone from tight fiscal consolidation in the first years of the sovereign debt crisis to economic growth.
"In view of the protracted recession, we must do whatever it takes to overcome the unemployment crisis in Europe," said EU Economic and Monetary Affairs Commissioner Olli Rehn. He called for the EU to undertake "structural reforms" to bring back jobs and said budget consolidation will continue at a slower pace.
"High unemployment points to the need for continuing the course in structural reforms," said Marco Buti, head of the commission's economics department. "The reduction in fiscal deficits is making headway in a differentiated way."
© Dukascopy Bank SA